I was fortunate this week, with a number of my CIGI colleagues, to sit down with the Governor of the Bank of Canada, Mark Carney, and some his colleagues to talk about, global financial reform, financial regulation, and among other things global governance. As we approach the G20 tonight (September 24th), to be followed up next week by CIGI'09, many of us are turning our attention to the possibilities for global financial decisions and global governance. Now global financial regulation, surveillance and IFI reform can be quite technical. So wading into the debate can be quite daunting and much of the debate generally is left to officials and experts. The same is not true for global governance architecture. On the surface, it seems, everyone appears to have a view on global governance and the ideal architecture for leadership.
The Gx process became a ‘handicapping’ event after the call by President Bush to attend a summit in Washington in November 2008 to deal with the global financial crisis. Rather than the US initial inclination to call the G8 or the G8 plus G5 together, the President was persuaded to call the G20. The long hoped-for Canadian proposal by Prime Minister Paul Martin – the L20 – suddenly was realized with the G20.
This G20 Leaders Summit followed by London and now Pittsburgh has led many to conclude that the G8, or the G8 plus the G5 have been replaced effectively and practically by the G20. The dismissal of the annual G8 meeting by leaders including rising power Brazil, and its President Luiz Inácio Lula da Silva - Lula – rang loud. The G8 represented the narrow interests of the traditional powers. A wide swath of media easily adopted that view: the scope of the global financial crisis had resulted in the G8 being superseded by the far more representative G20 including, traditional, large emerging market and developing countries.
But is it quite that obvious? Nicholas Sarkozy, the President of France, and holder of the G8 presidency in 2011, has publicly expressed his support to enlarge the G8 to the G14 – the G8 plus the G5 (Brazil, India, China, South Africa and Mexico + 1 Muslim country). The current holder of the presidency, Stephen Harper Prime Minister of Canada, has remained notably silent on the goldilocks solution (Canada has remained rather cool to enlargement of the G8 – it would naturally dilute the influence of Canada.) And then there is President Obama. The US takes the presidency for 2012. Though US officials have let it be known that they weren’t prepared to engage in architecture questions till after the Pittsburgh Summit, it would seem in discussions that officials seem to recognize that the G8 is no longer adequate. We may begin to understand American views on this question soon but likely well before 2012.
Why isn’t it quite so obvious that the G20 is now the natural Gx configuration for global governance leadership? It certainly appears to be obvious to numerous leaders, their officials and many experts from across the globe. Well I suppose we start from the view that the G20 is not just the G20. It has already expanded beyond that limit when President Sarkozy acted – presumably in the interests in Europe – to add Spain, the Netherlands and others. As a number of US officials made clear to a number of CIGI colleagues in a pre-summit meeting last week - well we know the G8 is now too narrow but the G20 may be too large, especially because it is not limited to 20.
So what are the dimensions at play in reaching consensus on global governance leadership? They are various and they go beyond the media’s general focus – indeed sole focus, it would seem - on legitimacy. I think there are at least 5 dimensions that officials are assessing as they ‘struggle’ to reach agreement on expansion. They are:
- Effectiveness
- Legitimacy
- Like-Mindedness
- Informality
- Equalness
Let me leave aside for the moment the two most frequently identified dimensions – effectiveness and legitimacy – and just briefly examine the others.
Informality is the dimension frequently mentioned by leaders but seldom by others. But G8 leaders have long appreciated the small group character of the annual meeting. These leaders’ meetings allow G8 leaders to speak openly and directly with each other and to come to understand the domestic difficulties different leaders face. Such informal but direct communication is very much appreciated by leaders and officials.
All the Gx groups, whether G8, or G13 or G20, incorporates equalness. These clubs avoid hierarchy and differentiation and promote equalness. The voice of each leader is regarded as having the same weight. This contrasts with the UN Security Council (15 members) and the Permanent 5 (with veto authority), or the weighted voting strength in the IFIs.
Like-Mindedness focuses on the similarity of views of leaders. Like-mindedness can be seen to be expressed with respect to norms and rules but also approaches and even policy goals. Many experts suggested that like-mindedness is defined by democratic affinity - a democratic club. But like-mindedness is not encouragement necessarily for a democratic club. The practical reality is that the US and India and Brazil differ strongly over humanitarian intervention, for example. The US and China see much in common over North Korea and counter-terrorism and nonproliferation.
Let’s turn back to the first two dimensions. Effectiveness is mentioned by almost all leaders, officials and experts. Bu effectiveness needs to be unpacked. It means a number of things. It means collective consensus and commitment. Leaders announce agreement on a standard or regulation. We should be seeing this at Pittsburgh. But effectiveness goes beyond just commitment. It extends to implementation. This is where the ‘rubber hits the road.’ Though there may be implementation at the international level, in many cases implementation can only take place at national capitals. Where states fail to implement or change what was agreed to at the global governance level in national legislation or regulation then implementation will be truncated. In some circumstances only formal international organizations have the means to bind states though even here implementation is not assured.
Finally, legitimacy. This dimension has been most discussed by officials and experts. The problem here is there is almost never agreement on what constitutes legitimacy. We saw the endless rather fruitless debate on enlargement of the UN Security Council ending in failure at the leaders summit in 2005. Many have suggested that the G8 is not legitimate but the G20 is. Yet demonstrators in Pittsburgh today and presumably tomorrow (September 25th) attack the G20 as being narrow and illegitimate.
So then the goldilocks solution? Well, let’s listen to the discussion. Indeed we can join it - certainly at CIGI 09. But lets not draw quick conclusions here.